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Human Resources

Employers on ICE

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Retailers have been put on alert that problems may be lurking in their archived hiring records after Abercrombie & Fitch was assessed penalties following an audit of some Michigan stores by a worksite enforcement team from the Department of Homeland Security’s Immigration and Customs Enforcement unit (ICE).

ICE also requested documents from Chipotle Mexican Grill for some of its Minnesota locations, after which the company either dismissed workers or saw a number of employees abandon their jobs. This resulted in charges of discrimination against Chipotle as well as demonstrations and protests staged by immigration advocacy groups.

ICE is “not looking for employers who made a one-time mistake,” but rather is targeting employers who “knowingly and egregiously” engaged in banned practices, says Gillian Brigham, an ICE public affairs officer. “We are working with … businesses to help them be in compliance.”

According to Brigham, there was a major shift in I-9 compliance enforcement with the change of presidential administrations. The Bush administration had focused on illegal and undocumented aliens by raiding worksites and detaining individual workers; the Obama administration began focusing on businesses that employ illegal and undocumented aliens — to “target the magnet” that attracts these workers.

The government’s position, as presented by Brigham, is that in many cases, businesses will knowingly hire undocumented illegal aliens “so they don’t have to pay taxes,” among other reasons. As a result, “We’ve exponentially stepped up audits.”

In the government’s fiscal year ended September 30, 2010, ICE conducted 2,740 audits — more than twice as many as the previous year — and collected penalties of $7 million.

To aid in stepped-up inspection of business records, ICE director John Morton in January announced the creation of the Employment Compliance Inspection Center to “address a need to conduct audits of the largest employers.”

The aims of the government’s I-9 compliance push are to “reduce the pool of illegal employment” and “ease pressure at the borders,” says Brett Dreyer, an ICE special agent in charge of worksite enforcement. By removing the ability of illegal aliens to work, fewer of them would likely try to enter the country in search of employment, freeing border agents for other law enforcement priorities and creating employment opportunities for citizens and legal residents.

Taking verification seriously
Abercrombie & Fitch was fined for “technology-related deficiencies” in its I-9 verification system, ICE said last September in announcing the results of its audit, adding that the company cooperated fully and “no instances of the knowing hire of unauthorized aliens were discovered.”

Brian M. Moskowitz, ICE’s special agent in charge of Michigan and Ohio, says “employers are responsible not only for the people they hire, but also for the internal systems they choose to utilize to manage their employment processes, and those systems must result in effective compliance.”

The Chipotle case differs from A&F’s in several respects. DHS has not issued an audit report nor announced any actions taken against the company. When Chipotle received a Notification of Suspect Documents — essentially a list of employee names whose documentation the government considered deficient or insufficient — it was legally required to ask the workers for further proof of their employment eligibility.

“As we have spoken to these employees about ICE’s request for new documents, many of them are telling us that they are unable to produce valid documents,” Chipotle communications director Chris Arnold wrote in an e-mail. “When this happens, we pay the employee for all of the time they have worked, vacation and bonuses earned, but the law does not allow us to continue to employ them.”

Chipotle says it has not terminated any employee who is able to produce documents showing he or she is entitled to work in the United States. “Unfortunately, most of them simply do not show up for work after being told of this issue,” Arnold wrote. “For those that tell us that they believe ICE made a mistake, we have given them additional time to clarify their status. The vast majority of our employees completely understand the situation. Nonetheless, we have agreed to send a letter to each employee who has been impacted by this to once again explain the situation, as well as to provide a copy of the Notice of Suspect Documents we received from ICE.”

Preventing errors
Employers are required to complete and retain I-9 forms for each individual they hire. The form — which is only one page but has 60 pages of instructions on how to complete it — requires employers to review and record the hiree’s identity and employment eligibility documents and determine whether the documents reasonably appear to be genuine and related to the individual.

Joseph Impastato, president and CEO of nowHIRE, a software firm that provides human resources solutions for dealing with the hiring process, calls the I-9 “the most complicated one-page form on earth.” The greatest potential problem for employers is the fact that their liability doesn’t expire until the form can be legally purged from the system. It’s hoped that automating the I-9 process will help prevent errors and omissions, since the form can’t be completed until every required line and box is filled in.

ICE offers businesses two tools to help maintain I-9 compliance. One is E-Verify, in which job candidates are screened for employment eligibility prior to going on the payroll. The other is IMAGE — ICE Mutual Agreement between Government and Employers — in which the government provides training and education on hiring practices as well as a list of a dozen compliance “best practices” in exchange for allowing ICE to audit all the company’s I-9 forms, past and present.

Approximately 240,000 firms make use of E-Verify for new hires, sending 16 million queries last year and getting eligibility confirmed at a rate of 96.9 percent. By contrast, only about 100 businesses have signed on to IMAGE in its nearly five years of existence. Employment consultants suggest that most businesses would rather not expose themselves to fines or penalties by volunteering to have federal worksite auditors poring over their I-9 forms.

Kevin Lashus, a former ICE lawyer now in private practice in Austin, Texas, says employers “can never get down to zero” compliance errors in their files since original forms must be retained along with any updated, corrected or re-verified forms.

According to Impastato, the real advantage of nowHire’s I-9 archiving and conversion system is that it “ensures that ‘the sins of the past’ are identified and edited to the extent permitted by law.” While it won’t completely absolve an employer, “Good faith auditing and cleanup of I-9s prior to an investigation has historically been a way for companies to minimize and even avoid fines,” he says.